No IPO Hangover: Varonis' CEO Talks Going Public After A Big First Day

As of mid-morning on Monday, Varonis Systems cofounder Yakov Faitelson still hadn't checked VRNS, the ticker symbol for his nine-year-old software company that went public on Friday. "I didn't even look, it's a milestone," Faitelson insists. "I had a feeling it would go well."

In a year with a bunch of high-profile public offerings in the works in tech, Varonis is one of the first to actually take the plunge, following Care.com, which listed in late January and currently trades at about its original list price.

Varonis, meanwhile, exploded on its first day, doubling its list price. The stock was down about 80 cents on Monday after spiking mid-morning, but is still over $43, almost double its $22 debut. And that on a day in which the S&P 500 index, Dow Jones Industrial Average and NASDAQ Composite all traded lower.

A New York and Israeli company, Varonis operates within the data and security space, essentially keeping track of how people are using different files and reports to make sure that the right employees and partners are accessing the data and to keep a company's risk minimal as it shares such information. Varonis bills itself as keeping the number of cooks in the pot to as small a number as possible by analyzing use cases and requirements to figure out who doesn't really need to be looped in and to notice anomalous use with those who are.

The company raised $106 million in its IPO, and the value of the 4.8 million shares it floated is now about $206 million. While not the biggest IPO, Varonis may prove another bellwether for the wave of tech offerings expected to come. Here's what Faitelson had to say on his first full workday as a public CEO.

FORBES: How did last week play out for you?

Yakov Faitelson: It was a productive process, Friday was very exciting. I watched with everybody, the core team. This is such a team sport. It was a lot of work to do interviews and talk to employees. Our lead investor, Kevin Comolli [a partner at Accel London] was there. We are very close, Kevin and Ohad [Korkus, Varonis cofounder]. To see the three of us making NASDAQ, it was good to be there with Kevin and Ohad, Ohad's father and my kids.

F: Does the ballgame change for you now as a public CEO?

YF: This company has been like a public company for a long time, we've had to be accountable and balance the short-term and long-term. So I think we are well-placed for the moment and the responsibility. Without going too much into specifics, it’s the same gameplan. There’s so much critical information and every company in the world needs to store and protect them. Varonis can do that with a lot of our products.

F: Going public gives Varonis access to more cash. What is Varonis going to do with it now?

YF: One of the keys for growth is sell capacity. We will put a lot of strength into sales capacity and distribution. In the last year and a half we started to invest more aggressively and we got good results.

F: A bunch of companies are looking to go public this year, and that means possible turnover as early employees cash out. Is that a concern at Varonis when lockups expire?

YF: We have a very strong culture and the core team has been many years together. Most of the people are very happy and the core players will stay for a long time. And there is so much upside in the future. One of the things that happened with a public company with stock options, there is high probability that if we keep executing, they will be able to create material wealth.

F: There are a bunch of tech IPOs scheduled for later this year [Aerohive Networks, Coupons.com, GrubHub Seamless and others who've secretly filed like Box to name just a few]. But Varonis is an enterprise software company and you've come out of the gate well. Is that a reflection of more interest in this area from the market?

YF: I think that definitely, there are software enterprise companies focused on data that are performing very well. Good investors with experience in enterprise assets, it's in the ecosystem now.